Lesson: Simple Interest

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Lesson Objective

calculate simple interest

Lesson Plan

 

Aim/Objective:

Key Points

Calculate simple interest

·         Interest - is an amount that you pay in order to use or borrow money or the amount earned on top of money that you invest.

·         Principal - is the amount of money you borrow or invest

·         Interest Rate - is the rate of interest paid over a given period of time, usually one year 

Assessment:

 

Lesson

·         _interest_is an amount that you pay in order to use or borrow money or the amount earned on top of money that you invest.

 

·         Principal __ is the amount of money you borrow or invest.

 

·         __interest rate_ is the rate of interest paid over a given period of time, usually one year

 

Notes:

 

Walk through examples/notes with students.

First you will be given three pieces of information – the principal, interest and time.  Now we can find the amount of interest by following the three steps:

 

·         There are three steps to finding interest.  Let’s look at the following example: 

 

Principal:  $450                Interest Rate:  4.9%            Time:  6 months

 

·         Step 1:  Use the Interest Formula.  Fill in the information that you are given.  

 

I =  p x r x t

 

Interest (I)

=

Principal (p)

x

Rate (r)

x

Time (t)

I

=

$450

x

4.9%

x

6 months

 

Change the numbers so you can calculate

§  4.9% = 0.049

§  6 months =  =  year = 0.5  

 

 

I

=

$450

x

0.049

x

0.5

 

 

   Step 2:  Multiply to find the interest

       

I

=

$450

x

0.049

x

0.5

I

=

$22.05

x

0.5

=

$11.025

 

 

                        Interest is about $11.03

 

 

o   Step 3:  Add to find the principal plus the interest

 

$450

+

$11.03

=

$461.03

 

Guided Practice

Walk through examples with students for finding interest

 

Find the simple interest and the sum of the principal and the interest for each.

 

Principal

Interest Rate

Time

Interest

Principal + Interest

 

1.      $598 

 

6.6%

 

1 yr

 

 

 

2.      $225

 

4.2%

 

1 yr

 

 

 

3.      $1,560

 

5.0%

 

6 mo

 

 

 

4.      $209 

 

7.1%

 

3 mo

 

 

 

5.      $10,000

 

4.75%

 

9 mo

 

 

 

 

 

 

Lesson Resources

Simple Interest HW  
1,279
Simple Interest CW  
1,066
Simple Interest Notes  
1,275

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